Since he AIA (American Invents Act) there has been one article after another in Forbes, Fortune regarding Patents, Copyrights on software design and engineering. In our humble opinion this area or domain is and will be a battle ground as to what is 'unique' and never been accomplished before. It used to be that the U.S. Patent Office gave out Patents on a regular basis without the level of scrutiny applied today.

Today, with the lack of trained Patent Examiners (understaffed) things will pile up and there is a backlog. Much frustration has arisen as company staff with PhD's have pulled back on those 'innovative ideas' that make companies winners. Companies are getting smart by offering their staff a major piece of the action. They get personal credit for the Patents at their company, money under the company unbrella.

The Open Source Community is a different animal. Far different than what we have ever seen. Open Source has been lifted to prominence via Hadoop (Yahoo, Google, Cloudera, IBM and others). The Parade has started with MapR, Flume, Yarn, AWS and Android-linux. From what I have seen in the courts is not much at all. We are witnessing a wild frontier of constant disruption. Good Open Source becomes mainstream much faster than we can imagine - Cassandra, MongoDB, CRISPR in BioTech.

And the Patent Courts are just currently ill-equipped to handled this literal free-for-all. I was at an IBM Bluemix Meeting in Austin, TX recently, One member ( I know his name) described it as a bunch of chickens getting out of their coupes in a state of madness. This has resulted in MEAN, LAMP, Full Stack and maybe, ha, IHOP will get in there.

This is truly the new frontier. And no, it won't end up like Theranos of Elizabeth Holmes intrigue.

It will only get crazier.

What area's are Open Source's interested in hearing about? I wonder how long this software will be free given that the 'advertising' model they are built on will last.

In the few lawyers and organizations we have spoken with there seems to be a free-for-all going on in Open Source Software, unlike other areas. Why, well as I see it some software developers will wake up that they are doing extremely valuable software design. And that their time, ideas and efforts have value.

Open Source and the AIA (American Invents Act-first to file is the game) seem to be alien to each other. Is it that the in such areas software is moving so fast that no one is saying we have something unique and should file for a patent?

Open Source has brought us Hadoop, MapR, Hive, Cassandra, R, .js, JSON, Ruby on Rails, MySQL for starters. I realize that companies with propietary software defend their turf. Something will happen and maybe Google and Amazon may find it and set some new standards.

It evens raises the question as to whether patents are even relevant in Open Source. I say someone will wake up given all the engineering involved and all the competition. See how Larry Page at Google and what will Zukerberg do with going from Oracle to OpenSource software? Zukerberg didn't want to pay Oracle's costly license fees.

Maybe its that we are in a 'disruption' at this point where developers just ignore patent laws (the AIA) as not 'relevant' anymore.

Is this the new Paradigm in Open Source Software?

Walter Criley Roper and Valerie Jo Atkinson, Wiley Patent Law writer would like to hear from the Open Sources and the Oracle, DB2 and the MongoDB (NoSQL) crowd.

What do you people think? Elizabeth Holmes of Theranos has patents and 'wants' to conform and get approval from the FDA.

Valerie and Walter R. are working on a touch area where the AIA (American Invents Acts) bumps into Open Source. When will Open Source Authors demand patents when their code or process in unique and achieves a 'Patent'. When will they stop 'giving away their hard, ingenious work.

This same issue also is ditto in the generic pharmaceutical business as to how will the AIA effect Patented Drugs going off patent and if they are 'challenged'.

Is there concern about China’s threat on patents and manufacturing? Think again. Since China has news media coverage concerning manufacturing. there is an intense focus on China. However, patent and entrepreneurial engines place the U.S. in the spotlight. Are real patent contenders South Korea, Japan and Germany? Or does China lead – or does the U.S.?

The America Invents Act will not change research & development or entrepreneurial effort. Though previously “the patent system is broken” was heard many times. Yet it may be fixed and faster than imagined.

Where are U. S. patents coming from? According to The Kauffman Foundation and the Global Entrepreneurship Monitor, professionals over 35 years old compose about 80% of the entrepreneurship activity in 2009. The Kauffman Foundation went deeper and conducted a survey of 549 startups operating in high-growth industries — including aerospace, defense, health care, computers and semiconductors. Survey results showed that professionals over 45 are twice as likely to launch startups in the same industries.
States with Research Parks:

Texas - 5

California - 4

Illinois - 5

Washington State - 2

New York -7

Mass -1

LA - 6

_________________________________________________________

Why is the U.S. patent production slowing? While historically the U.S. has been infatuated with the MBAs economic and monetary skills, the U.S. is just getting STEM (Science, Technology, Engineering and Math) initiatives in place. South Korea, Germany and Japan fully embrace STEM– making science go beyond the semiconductor. The Koreans as well as Japanese fully endorse STEM technology efforts.

Yes, the right ideas start with STEM, research & development. The biggest issue is remains: execution.

References
______________________________________________________

- Sources WIPO World Intellectual Property Organization.
March 2012

- U.S. Patent AND Trademark Office

- Kaufman Foundation, Kansas City, MO

(Note: This are a wide disparity about these patent numbers amongst countries. Many times they were hard to specify. These figures gives a solid foundation)

As
we have seen from companies like Apple and Google, creating a brand that is
associated with the products or services offered by a company is a key component
of a successful marketing campaign.From
an IP perspective, the brand may be protected by securing a federal trademark
registration.

Earlier
this month, the Federal Circuit rendered an opinion in the trademark case, Lens.com, Inc. v. 1-800 Contacts, Inc.The case primarily focuses on the mark “LENS”
in connection with “computer software featuring programs used for electronic
ordering of contact lenses in the field of ophthalmology, optometry and
opticianry.”With respect to the “LENS”
mark, this case presents a number of interesting issues that software developers
should consider when securing a trademark relating to their product or service.

One
issue concerns the name of the software product or service.The software developer should perform a
trademark clearance search on the proposed name of the software product or
service to determine whether the name is available for use in commerce.That way, when the software developer files a
trademark application on the name with the United States Patent and Trademark
Office (“PTO”), the risk that the software developer’s application is barred by
a prior trademark registration based on the likelihood of consumer confusion is
minimized.

After
performing a trademark clearance search on the name of the software product or
service, the software developer should seek registration of the proposed name
with the PTO.In Lens.com, the PTO originally allowed the registration for the mark “LENS”
in connection with computer software, which is surprising because “LENS” seems
to be a “merely descriptive” mark.Indeed, the PTO may refuse a registration of a mark if the mark is
merely descriptive (or deceptively misdescriptive) of the goods or services to
which it relates.As such, the software
developer should try to register a mark that is inherently distinctive in order
to minimize the risk that the registration is refused by the PTO.

Another
issue is whether the software product or service is being used in commerce.
This is important because failure to use the mark at all, or improperly using
the mark, may result in loss of the trademark registration.As shown in Lens.com, at any time, a third party may file a petition to cancel
the registration of a mark if the registered mark has been abandoned (i.e., the registered mark is not being
used at all).In order to avoid
abandonment, the software developer must use the registered mark in commerce.

As
defined in the Lanham Act, for goods, “use in commerce” requires (1) a good, as
defined in the description of goods in the trademark registration, in trade,
(2) that is sold or transported in commerce within the U.S.To qualify as a good in trade, the software
developer may place the registered mark on the packaging of the software
product or on documents associated with the software product, such as an
owner’s manual.As another example, if
the software product is a mobile application, the software developer could include
the registered mark in the icon for the mobile application or in a splash
screen when the mobile application is started.After the software product is marked so as to qualify as a good in
trade, the software developer should then actually sell or transport (e.g., distribute for free) the software
product in commerce.

As
further defined in the Lanham Act, for services, “use in commerce” requires (1)
using or displaying the registered mark, as defined in the description of
services in the trademark registration, in the sale or advertising of existing services
and rendering the services in commerce, or (2) rendering the services in more
than one state, or in the U.S. and a foreign country, and the person rendering
the services to be engaged in commerce in connection with the services.Services may be “rendered” in commerce in one
or more of the following ways: (1) rendering the services across state lines,
(2) customers crossing state lines in response to an advertisement for the
services, or (3) licensees or franchisees of the company that use the mark being
located in more than one state.

In
some situations, the same mark may be registered in connection with both a good
and a service. For example, in Lens.com,
the mark “LENS” was applied for use in connection with (1) “computer software featuring programs
used for electronic ordering of contact lenses in the field of ophthalmology,
optometry and opticianry,” and (2) “retail
store services featuring contact eyewear products rendered via a global
computer network.”

While
Lens.com was able to successfully establish use of its registered mark in
connection with its retail store services, Lens.com was not successful with respect to establishing the use of the mark in
connection with its computer software.Lens.com was successful with respect to establishing the use of the registered
mark in connection with its services at least because the registered mark was
displayed in connection with the sale of Lens.com’s retail store services, and
Lens.com’s retail store services featuring contact eyewear products were
rendered on a global computer network across state lines.

However,
Lens.com was not successful with respect to establishing the use of the
registered mark in connection with its goods at least because Lens.com’s
computer software did not qualify as a good in trade that was sold or
transported in commerce in the U.S.As described in Lens.com, the automatic download of computer software to a
consumer’s computer to facilitate the sale of contact lenses with respect to
Lens.com’s retail store services is insufficient use in commerce for the registered
mark in connection with computer software.This is because the computer software product lacked independent value
apart from, and is merely incidental to, the retail store services offered by
Lens.com.Moreover, Lens.com’s consumers
were not aware that the automatically downloaded software was associated with
the registered mark.On the other hand, had
Lens.com developed a mobile application that was independently sold or transported
in commerce apart from its retail store services, Lens.com would have been able
to establish use of the registered mark in commerce for the software product.

With respect to this, a software developer should ensure that his software product has independent value apart from any services offered by the software developer, and that the software product is not merely incidental to the services offered by the software developer. Additionally, the software developer should ensure that the consumers are aware that a registered mark is associated with the software product.

This blog entry was co-authored by Kelly McKinney, Patent Attorney, and Aly
Z. Dossa, Partner at Osha Liang LLP. This blog entry does not constitute legal advice and only
represents the views of the authors.

The third
milestone for a startup is product development.At this stage, the startup should think strategically about the
following issues: (1) identification of inventions within products and/or
services offered by the startup, and (2) protection of any developed source
code.As the startup begins to develop
the products and/or services it will provide, third-party developers outside of
the startup may be exposed to the startup’s IP.For example, the startup may seek a third-party developer to code all or
a portion of an application in accordance with the startup’s
specifications.Or, the startup may seek
a third-party developer to create an application that incorporates or links to
portions of the startup’s code base. Accordingly,
steps should be taken to protect the startup’s IP as third parties are given
access to the startup’s IP.

First, the
startup should strategically identify inventions within products and/or
services offered by the startup.After
these inventions are identified, the startup should decide whether to seek
patent protection for the invention or to maintain the invention as a trade
secret.If the startup decides to seek
patent protection, the invention will need to be disclosed in such a way as to
enable a person of ordinary skill to make and use the invention.In exchange for this disclosure, if a patent
is ultimately granted, the startup will have the right to exclude others from
making, using, and/or selling the invention covered by the patent for a term of
years.On the other hand, if the startup
decides to maintain the invention as a trade secret, the startup may enjoy an
unlimited monopoly on the invention as long as secrecy is maintained.However, there are risks involved with
protecting the invention as a trade secret: (1) the trade secret may be
misappropriated, or (2) a third party may independently develop the invention
that is the subject of the trade secret.

Second, the
startup should take steps to address various copyright issues that may arise during
the development of its product. For
example, the startup should outline procedures for using open source code such
as tracking what open source code/packages are used in the product as well as
the corresponding open source license.Care should be taken to ensure that distribution of the product complies
with the open source licenses.The
startup should also consider whether it is appropriate to seek formal copyright
registration of its source code (see http://www.copyright.gov/circs/circ61.pdf).

Third, in
the event that the startup retains the services of a third-party developer, the
startup should execute a written software development agreement that includes at
least the following clauses:

(1)
Confidentiality clause – This clause obligates the third-party developer to
maintain the confidentiality of information that the startup discloses to the third-party
developer, which may include the startup’s invention and certain specifications
thereof.A confidentiality clause is
especially important if the startup decides to maintain the invention as a
trade secret, if a patent application has not yet been filed, or if a patent
application has been filed with a non-publication request.

(2) Ownership
of IP clause – This clause should clearly indicate that the invention disclosed
by the startup to the third-party developer is owned by the startup.The clause should also obligate the third-party
developer to assign to the startup any modifications and/or improvements that
the third-party developer makes to the startup’s invention.Finally, this clause should address the
scenario in which the third-party developer uses her own custom libraries as
part of the software deliverable to the startup.In particular, this clause should cover a license
grant from the third-party developer to the startup with respect to the custom
libraries that the third-party developer used in the software deliverable.

This blog entry was co-authored by Kelly McKinney, Patent Attorney, and Aly Z. Dossa,
Partner at Osha Liang LLP. This blog entry does not constitute legal
advice and only represents the views of the authors.

The second
milestone for a startup is the hiring of the first employee.At this stage, the startup should think
strategically about the following issues: (1) protection of the current IP of
the startup, and (2) IP considerations related to bringing on a new employee.As new employees join the company, more
individuals are exposed to the startup’s IP.As a result, there is greater exposure for the startup with respect to
public disclosure of IP and/or theft of IP.In addition, adding new employees from a competitor may bring unwanted
attention from the competitor.Accordingly, steps should be taken to mitigate potential risks
(typically legal risks) from such competitors.

The above
issues are typically addressed in the form of an employment agreement.All new employees should execute an
employment agreement before they start working for the startup and, preferably,
before any confidential material is shared with the new employee.

To address
the above issues, startups should endeavor to address/include the following in
their employment agreements:

(1) Confidentiality
clause – This clause obligates the employee to maintain the confidentiality of
information that the startup discloses to the employee.The confidentiality clause may also obligate
the employee to restrict access to the startup’s confidential information on a
reasonable “need to know” basis.

(2) Ownership
of IP created by employee during course of employment at startup – The
employment agreement should clearly indicate that the IP generated by the
employee is owned by the startup.

(3) Duties
of employee with respect to IP – This clause obligates the employee to assign
to the startup any new IP generated by the employee, and obligates the employee
to assist (including executing of the necessary documents) the startup in
obtaining IP.

(4) Actions
taken if employee is terminated – This clause obligates the employee to return
to the startup all employee-generated work product, confidential information,
and equipment provided by the startup, upon the termination of employment.

(5)
Non-compete clause – This clause includes appropriate non-compete
provisions.Although the enforceability
of these provisions may vary by state, such provisions may restrict the ability
of the employee to compete with the startup at a future job and/or may address
any non-compete issues with the employee’s previous employer.

(6) IP that
employee generated prior to joining the startup – This section allows the
employee to delineate any IP that the employee created before beginning
employment at the startup that the employee is asserting he or she owns.This section is intended to give the startup
and the employee a clear understanding of what IP the employee owns and what IP
the startup owns in order to prevent future ownership disputes of such IP.

This blog entry was co-authored by Kelly McKinney, Patent Attorney, and Aly Z. Dossa,
Partner at Osha Liang LLP. This blog entry does not constitute legal
advice and only represents the views of the authors.

The first critical, and often overlooked, milestone for a startup is the founding of the company. At this stage, the startup should begin thinking strategically about the following issues: (1) the core idea upon which the startup is based, (2) the name of the startup, (3) the name of the product or service to be offered by the startup, and (4) the IP that the founders are contributing to the startup.

With the above IP issues in mind, the founders should take steps to determine which legal entity is going to "own" the IP. For example, is the IP going to be owned by the founders individually or by an operating company owned by the founders, e.g., New Company, Inc., or New Company, LCC? Once this decision is made, the founders should take steps to memorialize the ownership of the IP with the appropriate legal documents (e.g., company formation documents, assignment documents transferring IP ownership to the appropriate legal entity, etc.). At this stage, it is also advisable for the founders to create a founders’ agreement that outlines what happens to the IP in the event that the founders part ways and/or the company fails.

If the founders are contributing IP to the startup, the founders should take steps to (1) clearly delineate what IP they are contributing to the startup, and (2) ensure that the appropriate agreements (e.g., license or ownership agreements) are executed such that the startup has sufficient rights to use this IP.

Finally, with respect to the protection of IP, the founders should consider performing a trademark clearance search on their company name and/or product or service name to determine whether the name (for the company, product, or service) is available for use in commerce. The founders should also consider whether filing a patent application to cover their core idea (as opposed to maintaining the core idea as a trade secret) is warranted at this time.

This blog entry was co-authored by Kelly McKinney, Patent Attorney, and Aly Z. Dossa, Partner at Osha Liang LLP. This blog entry does not constitute legal advice and only represents the views of the authors.

Startups have been and continue
to be a major component of the technological industry. With the hope that a high-risk investment
will yield a profitable return, the founders and investors of a startup seek to
be a part of the next "big thing" or become the next household
name. Indeed, lucrative companies such
as Google, Facebook, and Twitter each had a humbling beginning as a startup. One critical area for startups is
intellectual property (IP). While today’s startups are savvier about IP than their
predecessors were in the ’90s, they still view IP in isolation with respect to
the startup as a whole. As a result,
startups tend to not think strategically about IP and are unable to obtain the
full benefit of the various forms of IP protection that is available.

Protecting IP allows startups
to take advantage of one or more of the following: (1) creation and
maintenance of a competitive advantage; (2) protection of the startup’s R&D
investment; (3) generation of revenue; (4) defense of the startup (in a
lawsuit); (5) protection of the startup’s brand; (6) attraction of investors;
and (7) the availability of collateral to secure financing.

A manageable way for a startup
to approach an IP strategy is to evaluate IP issues at critical milestones
during the startup’s life cycle. In this
way, the startup is able to make informed decisions related to the protection
of its IP as it relates to a particular milestone. Accordingly, the startup may strategically
address its IP issues in a focused way without being initially burdened with
developing a comprehensive IP strategy.

The
following series of blog entries will discuss various IP issues that may arise at
critical milestones during a startup’s life cycle. Such milestones include: (1) company founded;
(2) hire first employee; (3) product development; (4) product release; (5)
marketing; and (6) talking to potential strategic partners. Addressing the IP
issues that arise with each passing milestone may be critical to the survival
of a newly formed startup, and may be the key to a startup becoming profitable
and realizing a high return.

This blog entry was co-authored by Kelly McKinney, Patent Attorney, and Aly Z. Dossa, Partner at Osha Liang LLP. This blog entry does not constitute legal advice and only represents the views of the authors.

Saper Law gets questions all the time about the licensing schemes required to transmit music on a website or via a mobile application. This article serves as an overview of the various the copyright licensing requirements inherent in music streaming and distribution. If you have questions, just give Saper Law a call: 312.527.4100.
Copyright Licensing and [...]Read more at Saper Law's blog[Read More]

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